Transportation History

Transportation and Travel Evolution

• The pre-industrial era existed before railway development in Europe and North America.
• The pre-industrial era was characterized by stagecoaches and wayside inns.
• Only a small portion of the population could afford to travel during the pre-industrial era.
• The early-industrial travel system saw wide-ranging improvements like railways, canals, and steamship services.
• Travel increased due to increases in personal wealth.
• The mature-railway system era was marked by railway companies expanding operations to include hotels and travel-related services.
• Travel agencies and tour companies started to appear during the mature-railway system.
• Express travel saw increased services and trains stopping at major stations only.
• The automobile was the primary mode of transportation from 1920-1945.
• The introduction of wide-bodied jets in 1970 greatly increased air travel.
• "Mass tourism" and marketing approaches were common.

Selection of Transportation Mode

• Cost, travel time, safety, convenience, and comfort each play a role in selecting transportation.
• Jagdish Sheth developed a theory identifying transportation variables and traveler values.
• Psychologically weighing five factors influences traveler choices.

5 Factors According to Sheth

• Functional
• Aesthetic/Emotional
• Social/Organizational
• Situational
• Curiosity

Travel Modes

• Travel by train
• Travel by ship
• Travel by automobile
• Travel by bus/motor coach
• Travel by air

Train Travel

• Trains gave commoners the opportunity to explore distant locations enhancing travel and tourism.
• The first organized train tour happened in Britain by Thomas Cook in 1841.
• Trains enabled the growth of seaside resorts in Britain.
• The Pullman coach, built in 1863 by George M. Pullman, was a luxury first-class sleeping and dining facility.
• Amtrak started operating in May 1971, the Act of Congress created the National Railroad Passenger Corporation.
• VIA Rail was Canada’s intercity travel rail service.
• Four evident factors: cost/price, comfort, safety, and the ability to see the area where the train is passing.
• Downtown-to-downtown routing of trains saves passengers time.
• Euro City offers extensive rail service across 10 countries.
• Japan’s shinkansen (bullet trains) started in 1964 and provided rapid travel.
• Tres Grande Vitesse is France's supertrain which travels at 175 mph between Paris, Lyons, and Marseilles.

Ship Travel

• Ships primarily ferry or cruise.
• The steamship era began in 1840.
• The rise of jets led to a decline in regular passenger ship service during the 20th century.
• Water transport is utilized for ferrying and cruising.
• Many passenger ships converted to cruise ships.
• Other ships had historical value and converted to tourist attractions.

Cruise Ships

• These ships are both floating hotels and resorts because they house, feed, and entertain guests.
• Cruises are categorized in length as short (one week or less), intermediate (one to four weeks), and long (up to three months).
• Cruise ships offer hotel-like accommodations and amenities.
• Large vessels/ultra-yachts accommodate 180 or more passengers.
• Small vessels/mini-cruises carry fewer than 100 passengers.
• Ferry boats are important for short-distance travel, often utilized in coastal and island areas.

Automobile Travel

• Carl Benz is credited with inventing this in the 1880s.
• Henry Ford introduced mass production with the Model T in 1908.
• RV camping's popularity grew, and car rental companies expanded, especially at airports.

Bus/Motor Coach Travel

• Bus/Motor Coach travel is an affordable and flexible option.
• By 1928, Greyhound became the largest U.S. bus company

Air Travel

• Faster, cheaper flights fueled tourism and business travel.
• The Boeing 747 revolutionized long-haul travel.
• Charter flights made air travel accessible.

Meetings, Incentives, Conventions, and Exhibitions (MICE) Industry

• Encompasses hospitality and tourism, specifically in the planning and execution of large-scale events.
• Activities take place outside the peak leisure season.
• The Phil. International Convention Center (1976) was Asia's first international convention center.

Meetings

• They are designed to bring people together to exchange information.
• Meetings are organized by corporations, associations, or social, military, educational, religious, and fraternal groups.
• Three main types are theater style, classroom style, and boardroom style.

Forms of Meeting

• Symposium = subject is discussed by experts and a consensus of the group is gathered.
• Forum = assembly for a discussion of common concerns with experts who take opposing sides.
• Seminar = professionals gathering who work together under a discussion leader.
• Workshop = small group led by a trainer concentrating on skill enhancement.
• Clinic = small groups interacting with each other individually
• Colloquium = informal discussion on group-selected topics.
• Conference = a formal meeting of professionals exchanging opinions and information
• Convention = large meeting of people assembled for a common purpose.
• Panel = consists of two or more speakers.
• Lecture = an expert speaker addresses an audience.

Incentives

• Rewards used by corporations to motivate employees and increase sales.
• These may be in the form of goods or trips.

Conventions

• Usually larger meetings with some form of exposition or trade show.

Exhibitions/Expositions

• Events designed to bring together suppliers of products and services.

Key Players in the MICE Industry

• Meeting Planners may be independent contractors who offer their services or full-time employees of corporations or associations.
• Conventions and Visitors Bureau (CVB) represents an urban area to solicit business.
• Convention Centers are large facilities that hold meetings and expositions.
• Events Management refers to the process of planning, organizing, and executing events.
• Companies offer specialized services, and professional associations exist.

Convention and Special Events Management

• Destination Management Companies (DMCs): offer services primarily for inbound customers.
• Independent Meeting Management Companies (IMMCs): provide services to outbound groups.
• Travel Management Companies (TMCs): organize DMCs as part of larger travel services.
• Major Event Producers (MEPs): high-tech, high-visibility, and have dangerous components needing caution.
• Special Events Market: encourages networking, builds camaraderie, and lasting memories.

Types of Events in the Special Events Market

• Corporate Events
• Meetings
• Conventions
• Expositions
• Public Events
• Retail Events
• Social/Private Events

Emerging Trends

• The internet provides an accessible format for virtual meetings/exhibitions, video conferencing, and online education.

Leading Factors

:

• Changes in Communication Systems
• Changing Character of Nations

Tourism Marketing

• Marketing consists of all necessary activities to bring a product or service from manufacturer to end-user.
• Tourism marketing maximizes tourist demand satisfaction with research, forecasting, and the selection of tourism products and services.
• It is a management philosophy which maximizes benefit in line with tourist demand, research, forecasting, and selection.

Uniqueness of Tourism Marketing

• Selling an intangible service and experience.
• Services usually comprise several components such as transportation, accommodation, food/beverage, and attractions.
• Travel intermediaries bridge the gap between producer and tourist.
• Tourism demand is highly elastic, seasonal, and heavily influenced by taste and fashion.
• Necessitates a philosophy/orientation to guide marketing efforts.
• Product orientation emphasizes the products or services.
• Customer orientation places the tourist's needs and wants foremost.
• Societal-marketing approach (societal orientation) focuses on tourist needs and wants while being mindful of long-term community interests.

Market Segmentation

• The grouping of people with similar needs and wants in order to better serve the market.

4 Criteria of Market Segmentation

• Socioeconomic/Demographic
• Product-Related
• Psychographic
• Geographic

Product Life Cycle

• It is a guide to strategy based on which stage a product, service, or destination is in.
• Introduction requires high promotional expenses/visibility and is subject to failures.
• Growth is the stage in which the product or service is accepted by consumers.
• Maturity is the stage in which the product is well-established in the marketplace.
• Saturation is when sales volume reaches its peak.
• Decline advertising expenses are lower and competition is scarce.

Marketing Planning

• Data Collection is the first step which uses secondary and primary sources
• Analysis of Data involves the organizing and interpretation of data
• Identification of Alternative Strategies is next to reach the desired goal.
• A Cost-Benefit Analysis is used to determine if a project or action is worth pursuing by comparing its potential benefits to its costs.
• Selecting Alternatives and Plan Formation determines what actions should be implemented.
• Control Procedures are used to analyze the progress/goals of a project.
• Plan Implementation involves supervising the plan of action.

Selecting a Marketing Strategy

• Key considerations include identifying the market segment, determining their preferences, recognizing key influences, realizing the importance of the clients, determining the marketing mix, and establishing a price policy to maximize profits.

Marketing Mix

• Combination of product, price, promotion, and distribution.

Tourism Promotion

• The aim is to encourage actual and potential customers to travel by disseminating sales-stimulating information.
• According to Wahab (1997), the objectives of promotion are:
  • To make the tourist product widely known
  • To make it very attractive
  • To make the message attractive without being dishonest

Promotion & Communication

• Good promotion relies on good communication.
• The communication system is made up of sender, receiver, and message.
• Behavior modification is the end goal of the promotion.

Types of Promotion

• Information promotion is more important during the early stages of the product life cycle.
• Persuasive promotion is used early in the growth phase to build the owner's promotional efforts.
• Reminder promotion is important upon reaching a mature stage.

Relationship of Promotion to Marketing

• Marketing is the overall process, and promotion is one of the major elements in the marketing mix.

Promotion Planning

• Determines the goals the organization strives to accomplish, and the plan to achieve them.

Goals

• Important in developing promotional strategies.
• Goals must be SMART: specific, quantifiable, measurable, realistically attainable, and time-bound.
• They should be quantitative, precise, and realistically attainable.

Goals Should:

• Have a specific time period for completion
• Be written clearly, concisely, and specifically

Common Theme

• Necessary in establishing a market target.
• Promotion plans recognize the characteristics of marketing.

Market Targets

• Segmentation provides guidelines for isolating them, and identifies people according to socioeconomic status, social influences, personality features, attitudes, values, motivations, and expectations.

The Message

• Should be aligned with the goals and objectives, understandable, distinctive, and believable.
• Its purpose is to create awareness of the attraction.

Promotion Mix

• Tool that conveys the message to customers.

Major Types of Promotion Mix

• Advertising describes any form of paid, non-personal presentation and promotion of ideas, products, or services by a specific sponsor.
• Personal Selling refers to an oral presentation to customers on a face-to-face basis.
• Sales Promotion stimulates a purchase and are directed toward consumers or intermediaries with free events or special tours to promote services.
• Travel shows are put on by agencies and tour operators with special tours, food, displays, brochures, and films about destinations.

Forms of Advertising

• Newspaper
• Direct Mail sends promotional materials to potential customers.
• Brochure provides detailed information.
• Leaflets describe single sheets with minimum information.
• Travel Catalogs detail travel programs
• Sales Letter is more flexible
• Television is an audio-visual medium used by large organizations
• Magazines kept in waiting rooms and are retained longer than newspapers.
• Radio is a cost effective and flexible medium.
• Yellow Pages offer information to those requiring services.
• Outdoor Advertising uses visible spaces.
• Point of Sale uses displays, racks, and counters.
• Websites are powerful communication tools.

Public Relations

• Presentation of ideas, goods, or services about an organization using mass media
• Designed to create a favorable image of the product, service, or business unit
• It is not paid for.

Major Forms of Public Relations

• News Release
• Radio
• Talk Shows
• Print News
• Souvenirs -Memento

Principal Cost

• The cost per message, the cost per reader, and the cost of repeated messages.

Major Issue of Promotion

• Accuracy and reliability of information.
• Promotion's deceptive or misleading advertisement is the greatest issue.

Tourism Distribution Channel

• Connects travel service suppliers and consumers.
• Involves a system of distribution networks that makes tourism products available.

Twofold Purpose

• Provides necessary travel information to potential travelers.
• Facilitates reservations for tourism products.

Types of Distribution

• Direct Distribution: sells directly to the consumer.
• Indirect Distribution: sales occur through intermediaries.

Characteristics of Tourism Products & Distribution

• Products cannot be stored or held in inventory.
• Sales must occur daily for each available slot.
• Tourism relies on intermediaries unlike traditional industries.
• Intermediaries help package complementary travel products

Intermediaries

• Also known as Middlemen.
• Individuals or businesses that act as a link between two parties in a transaction.

Types of Travel Intermediaries

Travel Agents

• Arrange travel services from suppliers.
• Wholesale Travel Agents organize tour packages, which are sold to the public through a network or retail agents.
• Retail Travel Agents sell travel services directly to the consumer.

Travel Operators

• Provide services as specified in an advertised tour package, ranging from basic airfare, transfers, hotels, meals, sightseeing, and entertainment.
• Tour packages developed for the general public or organized according to the specifications of a wholesale travel agent.
• Ground operators - provide services at the destination
• Special Arrangements land arrangements, inbound agents/receiving agents special visitors.

Specialty Channels/Specialty Intermediaries

• Influence how, where, and when travel product will be distributed, including incentive travel firms offering professional services or acting as an intermediary.
• Incentive travel requires a greater knowledge of destinations.
• Meeting and convention planners specialize in planning and organizing meetings mainly for corporate clients.
• corporate travel firms handle all corporate travel accounts
• motor coach broker organizes motor coach tours on an outsourced basis

Distribution Channels

• PRODUCT SUPPLIER-CONSUMER CHANNEL = direct distribution without intermediaries
• PRODUCT SUPPLIER-TRAVEL AGENT-CONSUMER CHANNEL = most popular form of buying with intermediaries
• PRODUCT SUPPLIER-TOUR OPERATOR-CONSUMER CHANNEL = tour operator creates demand

Types of Distribution Channels

• CONSENSUS CHANNELS = North America and United Kingdom
• VERTICALLY-INTEGRATED CHANNELS = UK, West Germany and North America
• VERTICALLY-COORDINATED CHANNELS = franchising is one example

Distribution Strategies

• INTENSIVE DISTRIBUTION = products in many places
• EXCLUSIVE DISTRIBUTION = it limits the channels and outlets for the products
• SELECTIVE DISTRIBUTION = a strategy which is between intensive and exclusive distribution

Tourism Planning

• It is a dynamic process of finding goals, systematically selecting actions to achieve goals, implementing and evaluating the choice, which must keep up with the changing character of the destination area.
• Tourism Planning is essential to prevent a decline.

Destination Life Cycle Concept

• Defined by Plog (1973)
• Destination areas rise and fall in popularity.
• Travelers categorized into three psychographic groups:
  • Allocentrics - adventurous travelers, the first to visit exotic places.
  • Mid-centrics - majority of the travel market; this stage marks the peak of tourism.
  • Psychocentrics - cautious and prefer familiar places; this declines the destination.

Consequences of Lack of Tourism Planning

Impacts:

• Physical
• Human
• Marketing
• Organizational
• Other

Tourism Planning in Developed Countries

• Less difficult.
• Important and should provide a quality environment.

Tourism Planning in Developing Countries

• Important for foreign currency and increased employment.

Roles and Responsibilities for Tourism Planning

• In communist countries, planning is done by the national government.
• In democratic countries, government and the private sector take role in planning.

National Tourism Policy

• Basic foundation from which more specific goals, strategies, objectives, and plans are developed.

Barriers to Planning

• Many are against planning in principle.
• Expensive.
• Tourism industry is multifaceted.

Tourism Planning Process

• Background analysis phase
  • establishing a national tourism plan
  • usually classified into four: consumer/social, economic, resource/environmental, and government operations
• Detailed research and analysis phase
  • valid tourism plan cannot be formulated without research
  • resources, markets, activities, and competition.
• Synthesis phase
  • preparation of position statements on each of the five subjects
  • tourism plans provide the "bridge" between the present situation and the desired future situation
• Goal-setting, strategy selection, and objective-setting phase
  • planning goals, strategies, and objectives must be complementary to policy goals and objectives
• Plan development phase
  • details, it is then written in formal reports.

Tourism Development

• Tourism Development provides overall guidelines for development, outlines broad development concepts, and individual opportunities, also feasibility studies and cost-benefit analysis

The Roles of the Government and Private Sector in Tourism Development

• The private sector provides tourism services and facilities and skills.
• The non-profit sector operates attractions like museums and community halls.
• The government acts as a catalyst for private sector efforts.

Tourism Development Projects

• Can be initiated thru tourism planning.

Tourism Development Projects generating capabilities:

Profit-generating project

• Hotels/restaurants, financial feasibility determined with cost-benefit analysis. Non-profit-generating project
• Travel information centers.

Tourism Development Elements:

• Construction: building superstructures like hotels
• Programming and Events: human resources and equipment
• Economic Contributions: Creates a significant level of income and employment benefits.
• Environmental Impact: in compliance with existing legislation
• Social/Cultural Impact: does not jeopardize citizens well being
• Competitive Impact: complements existing business, without hurting financial viability of enterprise
• Tourism Impact: adding tourism potential
• Developer: capable of running the business
• Compliance
• Equity Contributions
• Feasibility - if it is easily done then its considered feasible

Steps in the Tourism Project System and Analysis

Pre Feasibility Study

• Determines justification of detailed study. Site Analysis
• A large proportion require physical site location
• Market related to Site Criteria = proximity for potential market
• Aesthetics,

Analysis

• Crucial part of an economic feasibility study, expensive and time consuming
  • Primary Research
  • Questionnaire
  • Focus Group
  • Delphi Method
  • Secondary research Analysis
• Implementation of primary and secondary research

Forecasting techniques

• Extrapolation = Cyclical trends with Covariation (Statistical relationship between two or more random variables)
• Estimation = mathematical Models

Economic Feasibility Analysis

• Project the financial return for investors. Cost Benefit Analysis
• Help these agencies measure and weigh all the costs and benefits of alternative projects.

Role of Government in financial development

two types (Fiscal incentives: allowances on income)

• Tax Holidays: Payment Deferrals
• Remissions of Tariffs: Relaxes goods/services.
• Tax Reductions: lowers tax rates
• Direct Incentives: includes requirements
  • Non Fundable Grants: reduce capital budget
  • Low Interest loans: reduces the amount pay during life operating (Loan Guarantees loans to projects by guarantees of private institutions (Working Capital loan funds (equity Participation buys shares and becomes the equity investor. ( Training Grants non refundable to the staff)

The steps to achieve the infrastructure for operations

(infrastructure assistance, assistance costs and infrastructure costs (Leasebacks purchases and land (Land donation to provide land charge)

Private sector financing of tourism

• For major funding

Detail and Construction for Tourism

• Architectural

Employment Opportunities in Tourism

A, airlines ,Flight attendants /ticket agents / airline food / flight dispatchers / operation agents station ramp agents / sales district managers ) / Flight Supervisors B) Tours ( travel agent and information) guides) C) Hostels /hotels : Managers and lodging D) Cruise lines- chief supervisors social directors) E) motor coaches dispatchers and attendants

F ) Car rentals Rental agents Representative

G) Hotels : operations Food and entertainment